SETO Data Analysis

Introduction

This document contains a detailed description of the data analysis plan for Solstice Initiative’s research titled, “Product Innovation to Increase Low- to Moderate-Income Customers’ Adoption of Community Solar PV”.

This research will incorporate data from three distinct datasets:

  1. Community Solar Priorities research survey forms completed by respondents of varying demographics assessing the favorability of factorial test contracts and offering feedback on various aspects of the community solar product;

  2. Developer and Financier Research survey responses from developers and financiers to assess price sensitivities of language used in contract agreements;

  3. Churn and Default Research records of subscribers leaving programs and missing payments (“churn and default data”) provided by solar developers.

Community Solar Priorities

Research Questions

The primary research questions we are attempting to investigate are listed below:

  1. How does contract attributes such as subscriber contract page length, savings rate, term length or cancellation fee attached to a subscriber agreement influence adoption rates for community shared solar?
  2. How does contract adoption rate differ between contract variables across term categories?
  3. How do varying demographics respond differently to contract variables included in community shared solar subscriber contracts?
  4. Outside of customer contract priorities, what other preferences do individuals have for the design of community solar programs?

The primary outcome from the Community Solar Priorities research will be the contract adoption rate, measured at the point of the survey.The secondary outcome from the Community Solar Priorities research will be hypothesis- generating data collected on broad customer priorities related to community solar program design that can inform future research.

Hypotheses

The following constitute the contract attribute hypotheses. Each is phrased as the null hypotheses.

  1. There is no significant difference in contract adoption between programs with a 9-page contract and 23-page contract.
  2. There is no significant difference in contract adoption between programs with 5% savings, 10% savings, and 20% savings.
  3. There is no significant difference in contract adoption between programs with and without a cancellation fee.
  4. There is no significant difference in contract adoption between programs with a 1-year term length and those with a 25-year term length.
  5. There is no significant difference in contract adoption across demographic characteristics, including race, income and homeownership status.

A number of independent variables will be used for both contract attributes and demographic data. Interaction variables will be tested for significant, along with a initial stepwise regression to determine which variables to initially include. The below equation is a summary of the full model used in this analysis. The dependent variable is a binary variable for contract adoption, \(y_{signup}\), where 1 signifies the contract was adopted and 0 signifies it was not.

\[\begin{equation} y_{signup} = \beta_{0} + \beta_{1}x_{sr} +\beta_{2}x_{cly} +\beta_{3}x_{clp} +\beta_{4}x_{cf} + \\ \beta{5}x_{inc}+\beta_{6}x_{race} + \beta{7}x_{hs} +\beta_{8}x_{fam} + \beta_{9}x_{rev} + \beta_{10}x_{ord}+ e_{i} \end{equation}\]

where,

  • \(x_{sr}\): savings rates on monthly energy bill in contracts, listed at either 5%, 10% or 20%
  • \(x_{cly}\): contract length years, either 1 or 25 years
  • \(x_{clp}\): contract length pages, either 10 or 20 pages
  • \(x_{cf}\): cancellation fee, either zero or $250
  • \(x_{inc}\): income, listed as Low (up to 50% of AMI), Moderate (50% - 120% of AMI), or High (>120% AMI)
  • \(x_{race}\): Categories include Asian, Black or African American, Hispanic or Latino, White and Other POC
  • \(x_{hs}\): Homeowner status for Homeowner, Renter or Other
  • \(x_{fam}\): More or less familiar with community solar
  • \(x_{rev}\): How much respondent reviewed the contract; up to half the contract review is captured by “less review”, over half and up to the whole contract is “more review”
  • \(x_{ord}\): Contract review order, likely not necessary.

Other variables of interest to consider: government program - x_govt

This research focuses on community shared solar (CSS) programs that are third-party owned and have participants subscribe to ongoing payments. Typically, within these programs, customers are given predefined, discrete contract terms rather than being able to compare multiple offerings or select their own terms. Our research is attempting to mimic this approach by giving customers a randomly assigned contract and surveying them on their willingness to adopt this program.

Descriptive Statistics

Descriptive Statistics
Variables N Percent
Signed up 1771 0.59
Not signed up 1215 0.41
Savings Rate 5% 1001 0.34
Savings Rate 10% 1003 0.34
Savings Rate 20% 982 0.33
Cancellation Fee $0 1495 0.50
Cancellation Fee $250 1491 0.50
1-year contract 1496 0.50
25-year contract 1490 0.50
Source = Qualtrics 2520 0.84
Source = Community Survey 466 0.16
On No Gov’t programs 1340 0.00
On at least 1 Gov’t Program 1646 0.55
Renter 1728 0.58
Owner 1248 0.42
White 1204 0.40
Black 580 0.19
Hispanic 414 0.14
Asian 434 0.15
Other - POC 354 0.12
Low Income 818 0.27
Moderate Income 1396 0.47
High Income 772 0.26

Crosstab Graphics

Savings Rate & Income

Savings Rate & Race

Race & Income

Cancellation Fee & Income

Cancellation Fee & Race

Contract Years & Income

Contract Years & Race

Survey Weights

The population for this component of our research is adults (18+) in the eight states we will include within this study: MA, NY, CA, OR, IL, MD, CO, and MN. We have chosen to oversample-populations that are considered low- to moderate-income (LMI) defined as up to 50% and between 50%-80% of an area’s median income, in accordance with the Department of Housing and Urban Development’s (HUD) definitions of each term. We have also chosen to oversample minority and renter populations in this research, surpassing the proportional estimates of these demographics supplied by the 2018 American Community Survey (ACS) estimates.

As late June 2023, 1,493 individuals responded to the survey. Given the oversampling of income, minority and renter populations, survey weights must be designed and implemented to avoid bias in describing the population.

Race Weights

Race, along with all demographic data, is self-attested through the survey. The categories included: Asian, Black or African American, Hispanic or Latino, Multiracial, Native American or Alaskan Native, Native Hawaiin or Pacific Islander, Other, White. To construct state level weights, the categories were further condensed into the following: Asian, Black or African American, Hispanic or Latino, Other, and White.

Using the American Community Survey (ACS) 2020 5-Year data, from table B03002, a comparable crosstab was developed to match the race categories for the survey.

The chart below shows the race proportions for the survey compared against the state totals for each of the eight states where responses were collected. Note, the oversampling of Black, Asian, and Other - POC is evident, whereas White and Hispanic or Latino are undersampled.

Total

Descriptive Statistics, 8-State Region
Race Census_Total Survey_Total Weight
White 52,150,851 602 86,629.32
Hispanic or Latino 24,830,970 207 119,956.38
Asian 9,585,168 217 44,171.28
Black or African American 9,540,566 290 32,898.50
Other - POC 3,841,546 177 21,703.65
Total 99,949,101 1,493 99,949,101.00

California

Descriptive Statistics
Race Census_Total Survey_Total Weight
Hispanic or Latino 15,380,929 107 143,747.00
White 14,365,145 134 107,202.57
Asian 5,743,983 120 47,866.53
Black or African American 2,142,371 82 26,126.48
Other - POC 1,713,595 72 23,799.93
Total 39,346,023 515 39,346,023.00

Colorado

Descriptive Statistics
Race Census_Total Survey_Total Weight
White 3,837,450 82 46,798.17
Hispanic or Latino 1,231,126 29 42,452.62
Black or African American 224,190 22 10,190.45
Other - POC 213,895 19 11,257.63
Asian 178,265 12 14,855.42
Total 5,684,926 164 5,684,926.00

Illinois

Descriptive Statistics
Race Census_Total Survey_Total Weight
White 7,737,459 74 104,560.26
Hispanic or Latino 2,190,696 19 115,299.79
Black or African American 1,766,586 54 32,714.56
Asian 702,457 18 39,025.39
Other - POC 318,966 15 21,264.40
Total 12,716,164 180 12,716,164.00

Massachusetts

Descriptive Statistics
Race Census_Total Survey_Total Weight
White 4,865,022 58 83,879.69
Hispanic or Latino 828,140 4 207,035.00
Black or African American 466,288 28 16,653.14
Asian 462,831 13 35,602.39
Other - POC 250,722 14 17,908.71
Total 6,873,003 117 6,873,003.00

Maryland

Descriptive Statistics
Race Census_Total Survey_Total Weight
White 3,028,494 28 108,160.50
Black or African American 1,773,702 34 52,167.71
Hispanic or Latino 619,418 3 206,472.67
Asian 382,027 4 95,506.75
Other - POC 233,983 4 58,495.75
Total 6,037,624 73 6,037,624.00

Minnesota

Descriptive Statistics
Race Census_Total Survey_Total Weight
White 4,422,490 46 96,141.09
Black or African American 354,540 9 39,393.33
Hispanic or Latino 307,675 2 153,837.50
Asian 273,100 5 54,620.00
Other - POC 242,361 4 60,590.25
Total 5,600,166 66 5,600,166.00

New York

Descriptive Statistics
Race Census_Total Survey_Total Weight
White 10,766,297 137 78,586.11
Hispanic or Latino 3,720,707 37 100,559.65
Black or African American 2,737,471 59 46,397.81
Asian 1,657,284 40 41,432.10
Other - POC 633,090 36 17,585.83
Total 19,514,849 309 19,514,849.00

Oregon

Descriptive Statistics
Race Census_Total Survey_Total Weight
White 3,128,494 43 72,755.67
Hispanic or Latino 552,279 6 92,046.50
Other - POC 234,934 13 18,071.85
Asian 185,221 5 37,044.20
Black or African American 75,418 2 37,709.00
Total 4,176,346 69 4,176,346.00

Income Weights

Respondents to the survey were asked to report their household income respective to customized AMI categories, dependent on both their household size and zip code using a custom income group calculation methodology (zips to fips.do). This calculation allowed for respondents to select income ranges for their household that corresponded to <30%, 30-50%, 50-80%, 80-120% and over 120% area median income (AMI).

Income weights are taken from the Housing and Urban Development (HUD) Office of Policy Development and Research (PD&R) Comprehensive Housing Affordability Strategy (CHAS) data. This data is released on a lagged timetable relative to the American Community Survey from the U.S. Census Bureau. Hence, the latest data available is five year 2018 data.

to-do: AMI last bucket is over 80, there is one more for 100% and over

  1. note that this is from table 11, where we can back into the calculation used by SETO
  2. CHAS output is for households, which is technically correct, but gender and race are by person, so the totals by state won’t look quite similar
HUD CHAS 2014-2018 Houseolds by AMI
state 1: Less than 30% AMI 2: Between 30-50% AMI 3: Between 50-80% AMI 4: Between 80-120% AMI 5: More than 120% AMI
California 1,833,800 1,535,410 2,026,165 2,294,225 5,275,825
Colorado 231,820 219,560 342,150 412,225 907,645
Illinois 646,950 560,715 773,960 894,685 1,953,715
Maryland 269,455 239,485 255,970 389,530 1,038,070
Massachusetts 393,300 282,985 336,210 448,605 1,140,815
Minnesota 248,055 244,935 342,430 449,560 882,820
New York 1,288,115 891,935 1,101,585 1,268,170 2,766,735
Oregon 167,840 165,925 254,310 293,920 709,845
Total 5,079,335 4,140,950 5,432,780 6,450,920 14,675,470

Total

Descriptive Statistics, 8-State Region
Income Census_Total Survey_Total Weight
1: Less than 30% AMI 10,158,670 218 46,599.40
2: Between 30-50% AMI 8,281,900 191 43,360.73
3: Between 50-80% AMI 10,865,560 360 30,182.11
4: Between 80-120% AMI 12,901,840 338 38,171.12
5: More than 120% AMI 29,350,940 386 76,038.71
Total 71,558,910 1,493 71,558,910.00

California

Descriptive Statistics
Income Census_Total Survey_Total Weight
1: Less than 30% AMI 1,833,800 81 22,639.51
2: Between 30-50% AMI 1,535,410 49 31,334.90
3: Between 50-80% AMI 2,026,165 115 17,618.83
4: Between 80-120% AMI 2,294,225 104 22,059.86
5: More than 120% AMI 5,275,825 126 41,871.63
Total 12,965,425 475 12,965,425.00

Colorado

Descriptive Statistics
Income Census_Total Survey_Total Weight
1: Less than 30% AMI 231,820 7 33,117.14
2: Between 30-50% AMI 219,560 7 31,365.71
3: Between 50-80% AMI 342,150 19 18,007.90
4: Between 80-120% AMI 412,225 11 37,475.00
5: More than 120% AMI 907,645 26 34,909.42
Total 2,113,400 70 2,113,400.00

Illinois

Descriptive Statistics
Income Census_Total Survey_Total Weight
1: Less than 30% AMI 646,950 21 30,807.14
2: Between 30-50% AMI 560,715 22 25,487.04
3: Between 50-80% AMI 773,960 28 27,641.43
4: Between 80-120% AMI 894,685 30 29,822.83
5: More than 120% AMI 1,953,715 62 31,511.53
Total 4,830,025 163 4,830,025.00

Massachusetts

Descriptive Statistics
Income Census_Total Survey_Total Weight
1: Less than 30% AMI 393,300 8 49,162.50
2: Between 30-50% AMI 282,985 10 28,298.50
3: Between 50-80% AMI 336,210 15 22,414.00
4: Between 80-120% AMI 448,605 22 20,391.14
5: More than 120% AMI 1,140,815 29 39,338.45
Total 2,601,915 84 2,601,915.00

Maryland

Descriptive Statistics
Income Census_Total Survey_Total Weight
1: Less than 30% AMI 269,455 9 29,939.44
2: Between 30-50% AMI 239,485 10 23,948.50
3: Between 50-80% AMI 255,970 17 15,057.06
4: Between 80-120% AMI 389,530 18 21,640.56
5: More than 120% AMI 1,038,070 19 54,635.26
Total 2,192,510 73 2,192,510.00

Minnesota

Descriptive Statistics
Income Census_Total Survey_Total Weight
1: Less than 30% AMI 248,055 10 24,805.50
2: Between 30-50% AMI 244,935 9 27,215.00
3: Between 50-80% AMI 342,430 8 42,803.75
4: Between 80-120% AMI 449,560 12 37,463.33
5: More than 120% AMI 882,820 26 33,954.61
Total 2,167,800 65 2,167,800.00

New York

Descriptive Statistics
Income Census_Total Survey_Total Weight
1: Less than 30% AMI 1,288,115 47 27,406.70
2: Between 30-50% AMI 891,935 50 17,838.70
3: Between 50-80% AMI 1,101,585 59 18,670.93
4: Between 80-120% AMI 1,268,170 58 21,865.00
5: More than 120% AMI 2,766,735 62 44,624.76
Total 7,316,540 276 7,316,540.00

Oregon

Descriptive Statistics
Income Census_Total Survey_Total Weight
1: Less than 30% AMI 167,840 5 33,568.00
2: Between 30-50% AMI 165,925 7 23,703.57
3: Between 50-80% AMI 254,310 11 23,119.09
4: Between 80-120% AMI 293,920 7 41,988.57
5: More than 120% AMI 709,845 24 29,576.88
Total 1,591,840 54 1,591,840.00

Primary Analysis

to-do

add intro/dialogue

Regression Tables

Table 1

## 
## Regression Table 1
## ===========================================================================================
##                                                 Dependent variable:                        
##                          ------------------------------------------------------------------
##                                                       Sign Up                              
##                               (1)             (2)              (3)              (4)        
## -------------------------------------------------------------------------------------------
## Savings Rate 10%             0.125           0.126            0.126            0.127       
##                             (0.090)         (0.090)          (0.090)          (0.091)      
##                                                                                            
## Savings Rate 20%             0.089           0.090            0.090            0.082       
##                             (0.087)         (0.087)          (0.087)          (0.087)      
##                                                                                            
## Contract Length 25 Years                   -0.202***        -0.202***        -0.213***     
##                                             (0.076)          (0.076)          (0.076)      
##                                                                                            
## Contract Length 20 Pages                     -0.046          -0.046            -0.053      
##                                             (0.072)          (0.072)          (0.073)      
##                                                                                            
## Cancellation Fee 250                                          0.001            0.008       
##                                                              (0.075)          (0.075)      
##                                                                                            
## High Income                                                                    0.210       
##                                                                               (0.137)      
##                                                                                            
## Moderate Income                                                               0.561***     
##                                                                               (0.120)      
##                                                                                            
## Constant                    0.304***        0.426***        0.425***           0.118       
##                             (0.073)         (0.091)          (0.097)          (0.126)      
##                                                                                            
## -------------------------------------------------------------------------------------------
## Observations                 2,975           2,975            2,975            2,975       
## R2                           0.001           0.004            0.004            0.023       
## chi2                     1.964 (df = 2) 9.619** (df = 4) 9.619* (df = 5) 51.020*** (df = 7)
## ===========================================================================================
## Note:                                                           *p<0.1; **p<0.05; ***p<0.01

Table 2

## 
## Regression Table 2
## ==========================================================================================================
##                                                         Dependent variable:                               
##                          ---------------------------------------------------------------------------------
##                                                               Sign Up                                     
##                                  (1)                 (2)                 (3)                  (4)         
## ----------------------------------------------------------------------------------------------------------
## Savings Rate 10%                0.115               0.120               0.158*               0.159*       
##                                (0.091)             (0.091)             (0.096)              (0.096)       
##                                                                                                           
## Savings Rate 20%                0.077               0.078               0.117                0.120        
##                                (0.088)             (0.088)             (0.094)              (0.094)       
##                                                                                                           
## Contract Length 25 Years      -0.209***           -0.223***           -0.229***            -0.226***      
##                                (0.076)             (0.077)             (0.081)              (0.081)       
##                                                                                                           
## Contract Length 20 Pages       -0.065              -0.065               -0.067               -0.057       
##                                (0.073)             (0.073)             (0.076)              (0.076)       
##                                                                                                           
## Cancellation Fee 250            0.013               0.012               0.037                0.041        
##                                (0.075)             (0.076)             (0.081)              (0.081)       
##                                                                                                           
## High Income                    0.290**              0.231              0.356**              0.348**       
##                                (0.144)             (0.146)             (0.157)              (0.158)       
##                                                                                                           
## Moderate Income               0.601***            0.540***             0.535***             0.526***      
##                                (0.122)             (0.124)             (0.132)              (0.132)       
##                                                                                                           
## Black                           0.075               0.162               0.089                0.073        
##                                (0.146)             (0.148)             (0.156)              (0.157)       
##                                                                                                           
## Hispanic                        0.224              0.319**              0.169                0.160        
##                                (0.153)             (0.158)             (0.169)              (0.170)       
##                                                                                                           
## Asian                          -0.136              -0.072               -0.017               0.004        
##                                (0.151)             (0.154)             (0.164)              (0.164)       
##                                                                                                           
## Other                          0.303*              0.376**             0.440**              0.442**       
##                                (0.177)             (0.179)             (0.189)              (0.190)       
##                                                                                                           
## Renter                                            -0.327***             -0.092               -0.070       
##                                                    (0.108)             (0.116)              (0.116)       
##                                                                                                           
## More Familiar                                                          1.470***             1.478***      
##                                                                        (0.110)              (0.110)       
##                                                                                                           
## More Reviewed                                                                               0.256**       
##                                                                                             (0.101)       
##                                                                                                           
## Constant                        0.026               0.167             -0.738***            -0.905***      
##                                (0.149)             (0.157)             (0.179)              (0.189)       
##                                                                                                           
## ----------------------------------------------------------------------------------------------------------
## Observations                    2,975               2,975               2,975                2,975        
## R2                              0.028               0.035               0.178                0.182        
## chi2                     62.852*** (df = 11) 79.180*** (df = 12) 421.368*** (df = 13) 430.983*** (df = 14)
## ==========================================================================================================
## Note:                                                                          *p<0.1; **p<0.05; ***p<0.01

Odds Ratios

Table 1

## 
## Odds Ratio, Table 1
## ===========================================================================================
##                                                 Dependent variable:                        
##                          ------------------------------------------------------------------
##                                                       Sign Up                              
##                               (1)             (2)              (3)              (4)        
## -------------------------------------------------------------------------------------------
## Savings Rate 10%             1.133           1.134            1.134            1.136       
##                             (1.094)         (1.094)          (1.094)          (1.095)      
##                                                                                            
## Savings Rate 20%             1.093           1.095            1.095            1.085       
##                             (1.091)         (1.091)          (1.091)          (1.091)      
##                                                                                            
## Contract Length 25 Years                     0.817            0.817            0.808       
##                                             (1.079)          (1.079)          (1.079)      
##                                                                                            
## Contract Length 20 Pages                     0.955            0.955            0.949       
##                                             (1.075)          (1.075)          (1.076)      
##                                                                                            
## Cancellation Fee 250                                          1.001            1.008       
##                                                              (1.078)          (1.078)      
##                                                                                            
## High Income                                                                    1.234       
##                                                                               (1.147)      
##                                                                                            
## Moderate Income                                                                1.752       
##                                                                               (1.127)      
##                                                                                            
## Constant                     1.355           1.531            1.530            1.126       
##                             (1.076)         (1.096)          (1.101)          (1.134)      
##                                                                                            
## -------------------------------------------------------------------------------------------
## Observations                 2,975           2,975            2,975            2,975       
## R2                           0.001           0.004            0.004            0.023       
## chi2                     1.964 (df = 2) 9.619** (df = 4) 9.619* (df = 5) 51.020*** (df = 7)
## ===========================================================================================
## Note:                                                           *p<0.1; **p<0.05; ***p<0.01

Table 2

## 
## Odds Ratio, Table 2
## ==========================================================================================================
##                                                         Dependent variable:                               
##                          ---------------------------------------------------------------------------------
##                                                               Sign Up                                     
##                                  (1)                 (2)                 (3)                  (4)         
## ----------------------------------------------------------------------------------------------------------
## Savings Rate 10%                1.121               1.128               1.172                1.172        
##                                (1.095)             (1.096)             (1.101)              (1.101)       
##                                                                                                           
## Savings Rate 20%                1.080               1.081               1.124                1.127        
##                                (1.092)             (1.092)             (1.098)              (1.098)       
##                                                                                                           
## Contract Length 25 Years        0.812               0.800               0.795                0.798        
##                                (1.079)             (1.080)             (1.085)              (1.085)       
##                                                                                                           
## Contract Length 20 Pages        0.937               0.937               0.935                0.944        
##                                (1.076)             (1.076)             (1.079)              (1.079)       
##                                                                                                           
## Cancellation Fee 250            1.014               1.012               1.038                1.042        
##                                (1.078)             (1.078)             (1.084)              (1.084)       
##                                                                                                           
## High Income                     1.336               1.260               1.427                1.416        
##                                (1.155)             (1.157)             (1.170)              (1.171)       
##                                                                                                           
## Moderate Income                 1.825               1.716               1.708                1.692        
##                                (1.129)             (1.132)             (1.141)              (1.141)       
##                                                                                                           
## Black                           1.078               1.176               1.094                1.076        
##                                (1.157)             (1.159)             (1.169)              (1.170)       
##                                                                                                           
## Hispanic                        1.251               1.376               1.184                1.173        
##                                (1.166)             (1.171)             (1.184)              (1.185)       
##                                                                                                           
## Asian                           0.873               0.931               0.983                1.004        
##                                (1.163)             (1.166)             (1.179)              (1.179)       
##                                                                                                           
## Other                           1.354               1.456               1.553                1.556        
##                                (1.193)             (1.196)             (1.209)              (1.209)       
##                                                                                                           
## Renter                                              0.721               0.912                0.932        
##                                                    (1.114)             (1.123)              (1.123)       
##                                                                                                           
## More Familiar                                                          4.349***             4.382***      
##                                                                        (1.116)              (1.116)       
##                                                                                                           
## More Reviewed                                                                                1.292        
##                                                                                             (1.106)       
##                                                                                                           
## Constant                        1.026               1.182               0.478                0.404        
##                                (1.160)             (1.170)             (1.196)              (1.208)       
##                                                                                                           
## ----------------------------------------------------------------------------------------------------------
## Observations                    2,975               2,975               2,975                2,975        
## R2                              0.028               0.035               0.178                0.182        
## chi2                     62.852*** (df = 11) 79.180*** (df = 12) 421.368*** (df = 13) 430.983*** (df = 14)
## ==========================================================================================================
## Note:                                                                          *p<0.1; **p<0.05; ***p<0.01

Discussion

Main Takeaways

  1. Table 1
  • Contract length of 25 years compared to 1 year remained a significant deterrent to contract acceptance rates.
  • Relative to low income, moderate and higher income respondents were more likely to accept the contract, holding th effect of savings rate, cancellation fee, and contract length constant.
  1. Table 2
  • Contract lenght remained a constant deterrance
  • Homeowner status, rent vs homeowner, was not observed as a statistically significant effect on signup rate. Likely some multicollinearity due to effect (sign) varying from model 2 to model 4.
  • After including familiarity and reviewed dummies, savings rate becomes statistically significant effect on likelihood of contract adoption.
  • More familiar with community solar implies significantly more likely to adopt contract (suggests importance of education) - odds ratio of >4 in model 3 and 4
  • In looking at contract adoption by race, Hispanics were the only group observed with a statistically significant effect in models 1 and 2. Relative to white, hispanic rates were higher. This effect is negated after additional IVs are introduces in models 3 and 4.

From Table 1, four models are presented analyzing changes in probability of sign up. Controlling for all other variables, contract length and income were found to have statistically significant effects on the rate of sign up. Contract length was found to have a strong negative impact on probability of contract adoption. For example, holding all variables constant, from model 2 we see that the odds ratio for contract length of 25 years is 0.782, meaning the group with contracts of 25 years are 0.782 times as likely as the group with contracts of 1 year of signing up, or a 21.8% decrease in odds of signing up.

Interestingly, lower income respondents were much less likely to adopt the contract, even when controlling for savings rate, contract length and number of pages, and cancellation fees. High income and medium income respondents were 1.3 and 1.7 times the odds to adopt the contract compared to low income respondents, controlling for contract attributes.

Secondary Analysis

The secondary analysis will include an ordered logit model to investigate the degree of which the same independent variables above influence the likert scale questions asked in the survey. Ordered logit models are commonly utilized with outputs of interest are categorized in discrete sequences, such as a Likert scale.

Would/Would Not Sign Up

Savings Rate

Tables 1-4 in output/regressions

Agree/Disagree

Developer & Financier

Developer and Financier Research: survey responses from developers and financiers to assess price sensitivities of language used in contract agreements

Due to the exploratory nature of this research, Solstice intends to leave analyses associated with the developer and financier component of this research unstructured in part. As a result of the expected small sample size, described in more detail below, we do not expect to be able to test for significance between observations. Rather, this analysis will be conducted through a detailed analysis of primary data collected via survey responses. Absence of existing published data detailing limiting factors and decision points related to constructing community solar subscriber agreements makes it difficult to establish a baseline in order to conduct hypotheses-generated analyses as outlined in previous sections. This research takes a grounded theory approach to construct theory through primary data collection and subsequent comparative analysis.

Research Questions

Average program terms

  1. What is the average savings rate offered by developers and financiers within their community solar programs?
  2. Do savings rates offered by different community solar developers and financiers?
  3. What are average term length offered by developers and financiers within their community solar programs?
  4. Do cancellation clauses offered by developers and financiers within their community solar programs?
  5. What is the average subscriber contract page length offered by developers and financiers within their community solar programs?

Further,

  1. Do economic/financing factors influence developers and financiers to structure community solar subscriber contracts?
  2. Under what conditions are developers willing to adjust their programmatic terms to include LMI populations in their programs?

The primary outcome of this research will be collecting and analyzing average terms used by solar developers and financiers in existing community solar contracts. The secondary outcome of the survey responses from developers and financiers will be measured by variables suggested to influence and limit offerings for existing community solar products.

Processing and Cleaning

There were 254 unique responses.

Descriptive Statistics

Savings Rates

An amazing plot

An amazing plot

An amazing plot

34.4% of respondents marked savings rate from 0-10%; 33% recorded 11-15%, and 32.5% answered 16-50%. Hence, nearly two-thirds of respondents recorded over 10% for savings rate for community solar.

Term Length

Cancellation Fee

Factors: Ability to make CS accessibility to LMI

CAC

Churn

Default

Communication

LMI ID

Financing

Takeaways

  1. Customer aqcuisition costs (CAC) was the strongest factor, with 55.5% responding as either very or extremely important.

  2. Defaults were relatively less important, nearly a quarter (23.6%) responding that it was either not at all or slightly important. When compared to threat of churn, respondents shifted from slightly to moderately important, implying that churn is more of a concern compared to default.

Bar Charts

Factors: Influence decision to include LMI in projects

Policy

Community Interest

Financier Interest

Company Interest

Equity

Takeaways

  1. For factors influencing the decision to include LMI households in CS projects, the most common answer was policy requirements and equity/inclusion efforts, with 63% and 58% or respondents marking these as very or extremely important, respectively.

  2. Community interest exhibited a large degree of moderate importance, with 44.7% of respondents, whereas only 43% respondents marked it as either very or extremely important, the smallest proportion exhibited in each of the five questions.

Bar Charts

Factors: Fill out CS Projects Quickly

Savings rate

Term length

Cancel fee

No On-bill credit

On-bill credit

Contract complex

Trust

Takeaways

  1. presence of on-bill credit for community solar projects exhibited the strongest positive response, with 58% of respondents recording it as probably or definitely impacted speed of CS projects being completed.
  2. Conversely, though marginally different, contract complexity and trust were the least powerful, with 17.6% and 19% of respondents, respectively, stating it either probably not or definitely did not have an effect on projects being quickly filled out.

Bar Charts

Savings Rate for Market and LMI

Churn Rate for Market and LMI

Project stage by highest churn/default

COD = commerical operational date (?)

Loan Loss Reserve

Alleviate Risk

Ideal Loan Loss Reserve

Summary statistics for loan loan reserve, percentage of total project revenue:

##    Min. 1st Qu.  Median    Mean 3rd Qu.    Max. 
##    3.00   20.00   34.00   36.87   50.00  100.00

Summary statistics for loan loan reserve, percentage of total years covered:

##    Min. 1st Qu.  Median    Mean 3rd Qu.    Max. 
##   1.000   2.000   5.000   9.132   7.000  70.000

Respondent Map

Coordinates have been obfuscated to protect location.

Churn & Default

Research Questions

Hypotheses

Descriptive Statistics

Primary Analysis

note

Analysis is awaiting Experian appending.

This analysis summaries the Nautilus customer data from the Frog Hollow and Howell community solar farm participation from January 2020 to April 2022. The goal of the analysis is to first describe the characteristics of the residents, the prevalence of default and/or churn rates, the prevalence of churn rates, and any statistically significant differences between groups in their default, late payments or churn rates.

The data is comprised of monthly payment performance and, where available, demographic data for residents. 32,385 monthly observations over 813 homes, 812 accounts and 621 users were initially observed. To avoid data quality issues and to analyze any potential churn and default trends, for Frog Hollow households the analysis will drop values in October 2021 until April 2022. This narrowed dataset is comprised of 31,704 observations; the homes, accounts and users did not change.

cd_input = ’/Volumes/GoogleDrive/Shared drives/*Solstice | Low Income Inclusion/Projects/2019-2022 DOE SETO Contract Innovations/DOE SETO Project Implementation/Project Management/Churn & Default Analysis’

The first ten rows of the data are presented, grouped by account number. Unique identifiers were replaced with sequential IDs.

  • Tenure: length in months each account was active
  • Payment_Method: either card or ACH/direct debit method
  • temp_solar: annual (right?) solar allocation in kWh
  • Churn_Tag: binary _var_iable capturing if an account left the solar farm
  • defauted: binary variable capturing if account holder defaulted on payment
  • Income: Low (<$50,000) or High (>$50,000)
  • Solar_Farm: Either Howell or Frog Hollow
First 10 Home Rows
Account_ID tenure payment_method temp_solar Churn_Tag defaulted Income solar_farm churn_reason
1 17 card 25.68 0 0 NA Howell (O&R) 0
2 22 card 6.65 0 0 NA Howell (O&R) 0
3 18 card 0.96 1 0 NA Howell (O&R) Billing Complaint
4 24 card 83.40 0 0 NA Howell (O&R) 0
5 25 card 6.05 0 0 High Howell (O&R) 0
6 23 ach 14.54 0 0 NA Howell (O&R) 0
7 23 ach 30.65 0 0 NA Howell (O&R) 0
8 3 NA 24.87 0 0 High Frog Hollow (CHGE) 0
9 25 card 7.92 0 0 NA Howell (O&R) 0
10 23 card 11.20 0 0 High Howell (O&R) 0

Descriptive Statistics

Total

The summary statistics below provide additional information. The average tenure of the 812 accounts was 20.3 months. The churn rate was 12.4%. The sample does skew towards high income homes, however note a large number of missing values were observed in income (567, 70%).

Descriptive Statistics
Total Mean Max Min
Tenure 16486.00 20.30 25.0 1
Defaults 4.00 0.01 1.0 0
Churn 101.00 0.14 1.0 0
Low Income 21.00 0.09 NA NA
High Income 224.00 0.91 NA NA
Solar 6294.78 7.75 83.4 0
Payment by Card 632.00 0.79 NA NA
Payment by ACH 172.00 0.21 NA NA

Frog Hollow

Frog Hollow Descriptive Statistics
Total Mean Max Min
Tenure 8799.00 19.38 22.00 2
Defaults 1.00 0.00 1.00 0
Churn 53.00 0.14 1.00 0
Low Income 9.00 0.21 NA NA
High Income 33.00 0.79 NA NA
Solar 3269.62 7.20 48.14 0
Payment by Card 376.00 0.84 NA NA
Payment by ACH 71.00 0.16 NA NA

Howell

Howell Descriptive Statistics
Total Mean Max Min
Tenure 7687.00 21.47 25.0 1
Defaults 3.00 0.01 1.0 0
Churn 48.00 0.15 1.0 0
Low Income 12.00 0.06 NA NA
High Income 191.00 0.94 NA NA
Solar 3025.16 8.45 83.4 0
Payment by Card 256.00 0.72 NA NA
Payment by ACH 101.00 0.28 NA NA

Tenure Length

Obersvations are next grouped by tenure length.

Account Tenure Length Statistics
Number of homes Churned Defaulted Average Solar Allocation Payment by Card Payment by ACH
≤ 5 29 12 0 5.01 18 3
5 to 10 42 22 0 7.27 35 7
10 to 15 23 10 3 7.66 22 1
15 to 20 718 57 1 7.89 557 161
Total 812 101 4 7.75 632 172

For homes that churned, the tenure was reasonbly much shorter than those that did not churn. The below graph shows the average tenure between these two groups, showing that it is almost double for those homes that exhibit continuous subscription.

Income

Resident Income Statistics
Income Number of accounts Churned Defaulted Average Solar Allocation Payment by Card Payment by ACH
High 224 46 3 6.56 191 29
Low 21 7 1 4.54 18 2
NA 567 48 0 8.34 423 141
Total 812 101 4 7.75 632 172

Churn Reasons

When a respondent left the program, a reason was recorded, when available. The below summarises the accounts that experienced a churn, which may further be collapsed into categories. Note the total below may not match the churn totals in the above descriptive statistics due to defaulted payments and duplicates included.

Churn Reasons Total High Income Low Income No Income
Moving out of service territory 39 18 5 16
No Longer Interested 35 21 2 12
Billing Complaint 12 2 1 9
Ineligible Meter 7 1 0 6
Defaulted Payment 6 3 1 2
Duplicate 6 3 0 3
Got Rooftop 5 3 0 2
Rejected by Utility - Initial Submission 4 0 0 4
Health Issues 3 3 0 0
Rejected by Utility - Subsequent Submission 1 0 0 1
Total 118 54 9 55 
## `summarise()` has grouped output by 'user_id'. You can override using the
## `.groups` argument.
## # A tibble: 812 × 6
## # Groups:   user_id [620]
##    user_id utility_acct_number tenure count_accts default count_churn
##      <dbl> <chr>                <int>       <int>   <int>       <dbl>
##  1      17 1769073011              23          23       0        0   
##  2      19 7989248005               3           3       0        1   
##  3      31 689005016               21          44       0        2.10
##  4      32 21002383038             22          23       0        0   
##  5      33 2155441000              15          30       0        2   
##  6      33 2536130080              17          34       0        2   
##  7      37 21003282874             22          46       0        0   
##  8      38 21001139837             22          69       0        0   
##  9      39 7376061001              22          44       0        0   
## 10      42 4381440011              15          15       0        1   
## # … with 802 more rows

Churn Figures

Solar

Tenure & Churn by Payment Method

Default Figures

Solar

Tenure & Default by Payment Method

Model

A logit model is deployed to analyze the probability of a home churning. The model in brief is described below. Without additional data collected from Experian, limited variability can be measured due to NA values in addition to limited number of coefficients to measure.

In the limited data available, statistically significant effects were measured for probability of churn for both tenure (Months) and days late. Due to relatively small number of observations of late payments, no statistically significant results were measured in probability of late or default payments.

\[\begin{equation} P_{d} = \beta_{0} + \beta_{1}*Months +\beta_{2}*(Payment Method = Card) +\beta_{3}*Income=Low \\ +\beta_{4}*Solar kwH + \beta{5}*(Solar Farm=Howell) \end{equation}\]

## 
## Call:
## glm(formula = Churn_Tag ~ tenure + payment_method + Income + 
##     temp_solar + solar_farm, family = binomial(link = "logit"), 
##     data = joined)
## 
## Deviance Residuals: 
##     Min       1Q   Median       3Q      Max  
## -2.5611  -0.4707  -0.4147  -0.2964   2.2310  
## 
## Coefficients:
##                        Estimate Std. Error z value     Pr(>|z|)    
## (Intercept)             4.10760    1.07719   3.813     0.000137 ***
## tenure                 -0.21760    0.03860  -5.637 0.0000000173 ***
## payment_methodcard      0.01136    0.72856   0.016     0.987562    
## IncomeLow               0.18221    0.66940   0.272     0.785467    
## temp_solar             -0.04837    0.05437  -0.890     0.373615    
## solar_farmHowell (O&R) -1.08611    0.51024  -2.129     0.033286 *  
## ---
## Signif. codes:  0 '***' 0.001 '**' 0.01 '*' 0.05 '.' 0.1 ' ' 1
## 
## (Dispersion parameter for binomial family taken to be 1)
## 
##     Null deviance: 242.38  on 218  degrees of freedom
## Residual deviance: 165.86  on 213  degrees of freedom
##   (593 observations deleted due to missingness)
## AIC: 177.86
## 
## Number of Fisher Scoring iterations: 5

The logit curves below show the relationship between the distribution of both tenure and days late with the probability of churning. The first graph shows that the longer the tenure, the lower the likelihood. The second graph shows that the days of late payments are generally not associated with likelihood of churn.